Survival guide, Switzerland: Renting and buying a house in Switzerland

Finding accommodation in Switzerland is not the easiest of tasks. It would be best to start searching before leaving your country. If you are bringing your family along, it is better for them to join you after you have found suitable accommodation. If you are arriving alone, guesthouses, hotels, or staying with friends are options. Many hotels and bed-and-breakfast establishments cater for long-term guests and offer weekly and monthly rates. Using an estate agent is costly but will ease the house hunt. Bear in mind that over and above the basic rent, garbage disposal costs, cleaning costs, and utilities are often additional charges.

Why rent? (Miete/Loyer)
Over seventy percent of the Swiss population rents. Renting a house or apartment has comparative advantages like favourable tenant rights (landlords are in no position to expel their tenants if payment is on time) and easy cancellation of leases. Leases tend to be made for a period of one year. If a conflict arises between you and your landlord, being a member of your local tenants’ association (Mieterverband, association des locataires) will prove beneficial.

Rent rates in Switzerland are comparable to other European countries. However, you will find variations between the cantons. Rents are higher in cantons like Basel, Geneva and Zurich, due to excess demand. Most landlords will expect a three-month deposit, or Kaution/Caution, which is returned when you move out, in addition to the interest earned over the rental period. Accommodation is generally rented unfurnished, but many apartments will be equipped with a stove, refrigerator and dishwasher.

Mortgages
Switzerland’s mortgage industry is characterised by the following:

• The highest withholding tax rate in any country
• Stable interest rates
• The highest per capita mortgage industry in the world

Foreigners can get between 60-80% of the house price. When you buy land, an apartment, or a house, moving duties and a land tax is four percent on average. This amount varies between cantons. The procedure for buying is to make an appointment with a local notary public after arranging your finances. The officer’s job is to ensure the legality of the transaction. The money is paid to the notary and it is passed on only after change of ownership is properly registered.  

Mortgages in Switzerland are collateralised with the land upon which the housing is located. The owner has a right to credit depending on the value of the land. The lender has a right to use the land if the borrower is unable to meet his or her mortgage payments. As there is high per capita mortgage embeddedness in Switzerland, the mortgage rate is the leading interest rate indicator in the country.

[Expatica, 2008]